MNM2604_ Assignment 03.

MNM2604_ Assignment 03. MNM2604 - Business-to-Business Marketing. THE DYNAMIC BUSINESS ENVIRONMENT First introduce the topic. 2.1 Global competition: More companies that are in the same market increased in South Africa, and some were global companies hence increased competition. AAf had to compete with these global competitors from other countries which came with competitive cheaper prices on the same product. Through globalisation, SA client firms can source products and services on a global scale and are not confined only to the SA products or companies therefore increasing competition. We know China has become the most global competitor in SA with cheaper prices on products.  AAf must consider importing Adhesive products from China and other global countries that supply reasonable prices, but to ensure not to compromise on quality to sustain the business.  They will have to increase quantity on their product so that they do not run out of stock when demand is more.  They must consider exporting some of their products to other countries like Zimbabwe and increase their market share and client base to maintain and sustain their business. 2.2 New Disruptive Technology: With the new technology and new applications that are introduced daily, many local companies become impacted as technological competition becomes prevalent. The new entrants came with the technically advanced adhesives and AAf had to compete with them.  AAf needs to create an attractive website that will enable the client firms to order online without having to go physically to them.  They will have to utilise social media as a marketing tool for their clients and for communication purposes, as they will have to recite on what the potential clients require/need, and then supply as per the needs of the clients/firms.  They will have to invest on advertising as another marketing tool to attract customers and they must ensure that their adverts indicates their being a S.African company (citizenship), as most client firms are strict on utilising local companies. Etc 1.3 Aggressive competitive behaviour: A firm may be a big, well structured and reputable organisation, but if they take longer periods to deliver to clients, that impacts negatively on the organisation as the client firms will look for alternative competing firm that will accelerate and deliver (with speed). Flexibility to react to any change in the market place is also very important and critical. New 1 This study source was downloaded by from CourseH on 09-21-2021 13:42:27 GMT -05:00 This study resource was shared via CourseH entrants of adhesives showed flexibility by also selling their product to final customers (B2C).  AAf supply chain division will have to increase the delivery speed to their client firms by setting timelines of delivery within a day.  AAf will have to forge strategic partnership with other adhesives businesses to get supply support on adhesive products when theirs get out of stock whilst the demand from customer firms is there.  On top of the intermediaries that AAf is considering for selling on their behalf to business customers, they need to be flexible and consider having a separate unit that sells directly to customers (B2C). 1.4 Heightened demand for better products: Competitors come up with advanced, simpler, better and lower priced products that sell. Client firms are always on the lookout for such bargains and this becomes a challenge on other marketing firms as the clients will move business to these new firms as they supply according to their unique requirements.  AAf should improve their adhesive product functionality.  They must introduce new advanced types of adhesives that are user-friendly, attractive and affordable. 1.5 Free trade (Deregulation) With the trade policies that were deregulated by SA government, companies from abroad can trade freely in SA. There is freedom of importing and exporting, and that becomes a major challenge for SA companies as competition increases.  AAf will have to import and export to other countries as well.  They have to extend their activities abroad and open businesses country wide and abroad. An example is that of Imperial Logistics (case study), a logistics and supply chain management company that has extended its businesses to Europe with their Head Quarters in Germany. Imperial Logistics has become a global leader through free trade and manages over 1.4 million containers in Europe every year. 2 This study source was downloaded by from CourseH on 09-21-2021 13:42:27 GMT -05:00 This study resource was shared via CourseH 3. CREATING AN INNOVATION ORIENTATION In order to survive in the competitive market environment and to perform better as a business, AAf should come up with innovation orientation as their new approach and to better their supply chain processes. By innovation orientation, managers of AAf must have a strategic thinking, a more focussed knowledge, coupled with innovative ideas and a structured broad learning philosophy 3.1 Learning Organisation- as an innovation orientation: AAf management will need to craft and possess common standards guidelines that will guide the organisational staff on policies and processes to be followed in the running of the business simply and effortlessly. The purchasing policies and quick delivery methods should be well designed and applied in the functional areas as they need to impress the AAf customer firms by speedy services which leads to good innovation. All staff members of AAF should learn these guidelines and policies and follow them strictly. Etc 2.2 Make innovation a key aspect component of organisation’s grand strategy: AAf management should ensure that in their strategic plans, innovation is discussed as the most critical aspect that will see the business prospering, and therefore innovative ideas must be a top priority than the rest of other strategies to be followed by the overall business. Innovation must be on drafting of the terms on how and when they will export and import their new and old adhesive products. Lead times on when to start ordering stock when the stock is at a certain level must be clearly documented; the countries that must be used for ordering stock that will be profitable must be specified. Clear guidelines on quality of adhesives that must be ordered must be drafted. 2.3 Innovation must be a cross-functional effort: All functional areas of Adhesive Africa must follow the same innovative orientation strategy as defined on the strategy. All structures and employees of the company should have the same belief and common understanding of the innovation and must be followed by everyone. Managers of each unit have to ensure that their staff follow the guidelines and are learning and implementing accordingly. The orders made at the supply chain unit must follow policies as drafted on the strategy for minimised risks.  To be able to achieve all the of the above, and to build the innovation culture in the organisation, innovation that is used should be a central theme as drafted by management and must be followed from top to the bottom by staff of Adhesive Africa. As the central theme, the objectives and goals must be clearly indicated on what the company wants to achieve at the end through the innovation orientation.  Furthermore, innovation should be seen as the long term investment as it will sustain the firm for a longer period in a competitive environment. Therefore, more time and patience should be given as AAf staff need to grasp and apply innovations gradually until fully absorbed. Employees of a business are the most important internal stakeholders 3 This study source was downloaded by from CourseH on 09-21-2021 13:42:27 GMT -05:00 This study resource was shared via CourseH that are the drivers of the business as they are hands on, and they need to be fully involved in innovation orientation, for example; In The Business Place (case study), the CEO terms the staff as “internal branding” as he says they are the key component to drive the change and to be re-energised. As a result Business Place is prospering. Etc Again, Innovation needs to be measured. AAf should have a set of standards and set time frames that must be followed and adhered to, so that at the end of the performance review period, results are measured against the set standards to ascertain whether it grasped and is followed by their staff in all units of AAf. Innovation development processes should be followed by the whole organisation and they must live and breathe the innovation programmes and implement the processes as per guidelines for the business to progress. Therefore, advanced resources on manufacturing machines of adhesives must be supplied by management to all the units to support innovation. As part of Innovation, collaboration with other business partners of adhesives must be pursued. AAf management to forge partnership with other companies which are on the same market and also which are not on the same, as the other depends on the other for their success (interdependence). This will ensure sustainability of AAf. Doing it together is more beneficial than doing it alone. If AAF glues can get finished, they can consult partners and get more supply from them, and vice versa. AAf has to ensure that social governance is central to the innovation strategy as the societal needs must be at the forefront. The business operates in a society and therefore societal needs must be looked at. This means that innovation content should be crafted accordingly to meet societal demands whilst at the same time promoting the Adhesive Africa brand. Lastly, innovation must focus on customer centricity. Customers are the other drivers of a successful innovation. A saying goes”:- “A customer knows best”, therefore AAF needs to focus on experiences of customer firms through constant engagements, and include this on the strategy based on the customer’s needs. For the success of their business, SAS’s business model is that “They listen to their customers, incorporate their feedback and consider their needs as they develop solutions for them” (SAS case study). Metrofile holdings limited uses same model as:- “Always placing the customer first”. For them to deliver quality service it is done through understanding the client’s needs and striving for improved efficiencies and responsiveness. (Metrofile case study).